KEPPLER Jan Horst

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Because of the global concern about CO2 emissions, climate change and energy transition, we are paying more attention to electricity demand management. In particular, with electricity load shedding, we can enjoy several benefits, such as increasing the efficiency of the whole electricity market, enhancing the security of electricity supply, and making investment more efficient and desirable as well as benefiting the environment and supporting renewable energy. In Europe, France started the NEBEF mechanism at the end of 2013, and South Korea launched the market-based load shedding program in late 2014. Among a number of issues and assumptions we need to consider in terms of load shedding, estimating the reference curve is one of the most important and fundamental elements. In this research, based on the rescaled consumption profile for an average household, several methods of estimating the reference curve are established and examined for both French and Korean load shedding mechanisms. This investigation on the estimation methods could contribute to the search for a better and more accurate estimation method that will increase the incentives for participants. With the estimated reference curves, cost-benefit analyses were performed, which were used in the decision analysis for the participants. To perform the cost-benefit analyses, a simple mathematical model using linear algebra is created and modified to properly represent the parameters of each of the load shedding mechanisms. This model allows us an intuitive and clear understanding of the mechanisms. This generic model can be used for different countries and sectors, residential, commercial and industrial, with some model modifications. Monte Carlo simulation is used to reflect the stochastic nature of reality, and optimization is also used to represent and understand the rationality of the participants, and to provide microeconomic explanations of the participants' behaviors. In order to derive meaningful implications for a better architecture of the clearing market, several sensitivity analyses are performed on key elements of the model for the mechanisms.

Capacity mechanisms (CRMs) are set up to align the market equilibrium with the social optimum, i.e. to ensure security of supply at the lowest cost. In theory, energy-only markets are supposed to achieve this objective, but their effectiveness is questioned. While the merits of characterizing CRMs as a second-best mechanism have occupied researchers for several decades, the empirical evaluation of CRMs has received much more limited attention. This gap provides a fertile area for academic research, but limits one's ability to translate theoretical findings into policymaking. Empirical evaluation of MRCs is all the more necessary because their performance depends not only on country-specific structural, technical, and cultural parameters, but also on the details of their implementation. As such, this thesis presents the first work dealing with the empirical performance of CRMs as well as with regulatory implementation choices. The study of the relative convergence of MRC designs since the 1990s allows for the identification of the characteristics essential to their success, while the divergence of results in the existing quantitative literature helps to assess the remaining future challenges. The net cost of such a market intervention is also discussed using a cross-national econometric approach. Finally, agents' preferences for the accuracy of information on capacity obligations are addressed in an analytical model.

In the electricity industry, the technological progress brought about by smart grids is challenging the idea that consumers cannot react to wholesale market prices. However, the integration of Demand Response (DR) into the power system is challenged by the question of its economic efficiency. This thesis evaluates the economic value of DS by using an energy market model under uncertainty to calculate the profits of an aggregator, by consumer class and end-use. The model belongs to the class of linear stochastic multi-period problems. Its resolution is based on Stochastic Dual Dynamic Programming. It appears that in France, the profitable sectors are the industrial load-shedding and the load-shifting of cement and paper. The load-shifting of electric heating is not profitable for the tertiary and residential sectors. In addition, the capacity value of DEs is critical. Overall, DEs are becoming viable, but the development of their potential seems to be conditional on a decrease in fixed costs in smart grid technologies.

Interconnecting two adjacent areas of electricity production generates benefits in combined consumer surplus and welfare by allowing electricity to flow from the low cost area to the high cost area. It will lower prices in the high cost area, raise them in the low cost area and will thus have prices in the two areas converge. With unconstrained interconnection capacity, price convergence is, of course, complete and the two areas are merged into a single area. With constrained interconnection capacity, the challenge for transport system operators (TSOs) and market operators is using the available capacity in an optimal manner. This was the logic behind the “market coupling” mechanism installed by European power market operators in November 2009 in the Central Western Europe (CWE) electricity market, of which France and Germany constitute by far the two largest members. Market coupling aims at optimising welfare by ensuring that buyers and sellers exchange electricity at the best possible price taking into account the combined order books all power exchanges involved as well as the available transfer capacities between different bidding zones. By doing so, interconnection capacity is allocated to those who value it most.

The context and the policy objective guiding the liberalisation of the electricity industry have changed significantly over recent decades. Policy priorities in favour of decarbonisation and maintaining security of supply have taken centre stage on the policy agenda in many countries. The emergence of new decentralised and variable technologies and the change toward fixed cost technologies have profound implications for market dynamics.

Economics so far provides little conceptual guidance on capacity remuneration mechanisms (CRM) in deregulated electricity markets. Ubiquitous in real-world electricity markets, CRMs are introduced country by country in an ad hoc manner, lacking the theoretical legitimacy and the conceptual coherence enabling comparability and coordination. They are eyed with suspicion by a profession wedded to a theoretical benchmark model that argues that competitive energy-only markets with VOLL pricing provide adequate levels of capacity. While the benchmark model is a consistent starting point for discussions about electricity market design, it ignores the two market failures that make CRMs the practically appropriate and theoretically justified policy response to capacity issues. First, energy-only markets fail to internalize security-of-supply externalities as involuntary curbs on demand under scarcity pricing generate social costs beyond the private non-consumption of electricity. Second, when demand is inelastic and the potential capacity additions are discretely sized, investors face asymmetric incentives and will underinvest at the margin rather than overinvest. After presenting the key features of the theoretical benchmark model, this paper conceptualizes security of supply externalities and asymmetric investment incentives and concludes with some consideration regarding design of CRMs.

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At the request of the French Electricity Union (UFE), Jan Horst Keppler, Professor of Economics at the University of Paris - Dauphine, and Régis Bourbonnais, Senior Lecturer at the University of Paris - Dauphine and specialist in econometrics, have undertaken a series of statistical tests to determine the price elasticity of electricity demand in France.

At present, although most nuclear countries are converging on the same technical solution: deep disposal for the management of high-level and long-lived radioactive waste, the time objectives differ from one country to another. Through economic calculation, we wish to provide elements of an answer to the following question: In terms of temporality, how should the present generations, which benefit from nuclear electricity production, bear the burden of radioactive waste management, taking into account future generations? This thesis proposes to analyze specifically the French decision, taking into account its context. We propose a set of tools to evaluate the utility of the deep disposal project according to the choices of temporality. Our thesis also studies the feedback influence of storage choices on the nuclear fuel cycle. Beyond that, we take into account the interactions between deep storage and the choices of nuclear fleet and fuel cycle that constitute a "complete system".

The rise of variable input renewable technologies poses many challenges to the operation of the electrical system. This system must guarantee the supply-demand balance at all times, as well as ensure high levels of service reliability. Therefore, variability increases the need for flexibility and system services. There are several options capable of providing these services, including: strengthening interconnections, smart demand management, strengthening the rapid response capabilities of generation units, and implementing electricity storage technologies. However, the current electricity markets are based on the remuneration of energy. Therefore, the full valuation of the services that storage can provide seems difficult, which restricts the business case for flexibility options.This thesis focuses on the following issues: (1) modeling and evaluating the interrelationships between variability, flexibility needs and decarbonization objectives, (2) analyzing the role, as well as the value, of different storage technologies through the French case for the 2020, 2030 and 2050 time horizons, and (3) discussing the regulatory aspects of flexibility, as well as proposing concrete energy policies that allow the success of the energy transition and decarbonization objectives of the French electricity mix.

The PV market has experienced strong growth over the past decade, supported by favorable policy actions in a context of energy transition. However, despite these beneficial conditions, the global PV market has paradoxically gone through a chaotic period with overproduction problems, an industrial crisis and long-lasting trade disputes between countries. This thesis takes these issues as a starting point and attempts to understand PV public policies and their impacts on technology and market dynamics. In order to clarify these issues, a systemic approach is used to provide a correct understanding of the general mechanisms of PV public policies. A concrete systemic overview of these mechanisms is constructed based on theoretical and historical analyses by defining key variables and context. A retrospective analysis using purpose-built mappings is conducted to identify critical limitations and challenges of the PV sector as well as risk factors. This thesis also shows how the nature of the policy environment is changing in conjunction with the dynamics of the PV sector. The thesis highlights that the national dynamics have been broken by China's entry into the PV sector. The thesis ultimately proposes strategic directions for PV development along two dimensions, domestic and international. At the national level, the thesis focuses on PV self-consumption as a natural way to use PV energy in the power system. This analysis implies a change in the nature of PV policies in the future. Finally, in order to solve the current industrial crisis, the thesis presents possibilities for collaborative international actions to create a new PV demand in the international context by seeking economic and environmental benefits at the global level.

This English translation of Heinrich von Stackelberg’s Marktform und Gleichgewicht will be welcomed by economists working in the field of industrial organisation and beyond. It has been overdue for more than 80 years. This translation will allow matters to be set straight concerning a number of fundamental theoretical issues connected to Stackelberg’s work as well as allow to clarify a number of misunderstandings that go back to the first reviews of Stackelberg’s 1934 classic on competition theory.

As speculative flows into commodity futures are expected to link commodity prices more strongly to equity indices, we investigate whether this process also creates increased correlations amongst the commodities themselves. Considering U.S. oil and gas futures, we investigate whether common factors, derived from a large international data set of real and nominal macroeconomic variables by means of the large approximate factor models methodology, are able to explain both returns and whether, beyond these fundamental common factors, the residuals remain correlated. We further investigate a possible explanation for this residual correlation by using some proxies for trading intensity derived from CFTC publicly available data, showing most notably that the proxy for speculation in the oil market increases the oil-gas correlation. We thus identify the central role of financial activities in shaping the link between oil and gas returns.

Liberalized electricity markets are assumed to provide long-term coordination of investments to ensure security of supply, sustainability and competitiveness. In the energy-only reference model, price formation by aligning the variable cost of marginal equipment in successive hourly markets provides a price signal to investors. However, in practice, this model is questioned as to its ability to trigger investments in low-carbon technologies and in particular renewable energies (RE) and as to its ability to guarantee security of supply. This thesis first seeks to characterize these two market failures and then looks at different solutions to address each of them. The results show that the replacement of non-market support mechanisms by market investments with the help of a carbon price appears to be a solution to trigger the development of RE, provided that there is a strong political commitment to a high carbon price. On the other hand, it also appears that the energy-only market with capped prices does not succeed in ensuring capacity adequacy. The addition of a capacity market or the removal of the price cap would allow for an improvement in the number of hours of load shedding and collective welfare. Moreover, the capacity market appears to be the best choice for the regulator among the market architectures considered.

The European electricity system can be described by the concept of an integrated system, i.e. an interconnected network whose organization is divided by various administrative borders of a legal, technical or market nature. In this context, the improvement of the coordination of the operation on these internal borders, for a given set of infrastructures, should allow a more optimal use of the available resources.The economic analysis of these cross-border coordinations and of the improvement process underway in Europe in 2012 allows on the one hand to draw lessons from this experience and on the other hand to support the improvement process by contributing to the understanding of the stakes by the actors. To this end, the study first provides a summary of the management of the electrical system, which defines the subject of the study. Then, the second chapter details a functional analysis of the coordination mechanisms. This analysis makes it possible to make the link with the technical aspects that condition the economic organization. The third chapter deals with methods for evaluating the benefits, costs and redistributive effects of a change in coordination. Chapters four and five then address two key institutional angles. The first is the role of the European Union in establishing common rules at the continental level. The second is the institutional form of the Transmission System Operators' (TSOs) commitment to the success of these coordination mechanisms.

In this paper, we present a synthesis of the results of the study "Nuclear and Renewable Energy: Systemic Effects in Low-Carbon Power Systems" recently published by the OECD Nuclear Energy Agency. This study analyzes the interactions between programmable technologies and variable renewables (mainly wind and solar), presents the main effects of these interactions on the power system and provides systematic empirical estimates of the associated costs for six OECD member countries.

No summary available.

In this paper, we present a synthesis of the results of the study "Nuclear and Renewable Energy: Systemic Effects in Low-Carbon Power Systems" recently published by the OECD Nuclear Energy Agency. This study analyzes the interactions between programmable technologies and variable renewables (mainly wind and solar), presents the main effects of these interactions on the power system and provides systematic empirical estimates of the associated costs for six OECD member countries.

The objective of this thesis is to define the potential current and future effects of investment flows from Clean Development Mechanism (CDM)-type projects or any other successor mechanism. Thus, we propose an assessment of this type of investment, as perceived by developing countries in the 2020 and 2050 time frame, as well as their economic effects. We also try to define the characteristics (observed so far) of these flows and their interactions with the financial flows "classically" perceived by Developing Countries (DCs): official development assistance (ODA) and foreign direct investment (FDI). It also examines the main factors that could lead to greater benefits for recipient countries, as well as the impacts of CDMs in terms of sustainable development and technology transfer. The analysis is completed by a description of the main obstacles that exist (due to the characteristics of the receiving countries but also of the mechanism itself), of the attempted solutions already adopted as well as of the alternative mechanisms that could be put in place in the future. Thus, the analysis demonstrates the beneficial effects of CDM projects (or potential successor mechanisms) in terms of perceived investments, Carbon Reduction Units (which may result), economic growth, technology transfer and sustainable development for non-Annex I countries. In addition, the analysis highlights the importance of the absorptive capacities of these countries (notably the presence of skilled labor, availability of credit facilities and infrastructure in the field of renewable energy) in order to benefit more widely from the potential economic benefits. Thus, the implementation of a similar mechanism, improved and accompanied by capacity building programs, should be of great interest to both Annex I and non-Annex I countries in future UNFCCC negotiations.

If the liberalization of the electricity industry calls for a very long time, such is the complexity of this industry, Europeans expect, after fifteen years, identifiable benefits in terms of price, innovation in associated services, environmental performance or security of supply. Rather than the evidence of progress, complexity - or even confusion - characterizes Europe's electricity industry today. The insertion of large-scale intermittent renewables amplifies the difficulty of progressing towards a simple and efficient electricity market regime. The vocation of the new European Electricity Markets Chair, which has just been set up at Paris Dauphine, is to enter into this complexity in order to explore second- and third-tier solutions that could improve the situation. The path is narrow, but it seems possible to us, in the European electricity space, to combine public coordination, market regime and social equity. This is done here around seven recommendations, some of which directly concern the challenges of the energy transition.

Distribution remains the least studied segment of the electricity sector. However, for the past two or three years, there has been much discussion about possible structural changes due to the emergence of smart technologies: in the next few years, these could call into question the current business models of the DSOs and their regulation methods. But many uncertainties weigh on their investment choices. This thesis aims to anticipate the evolution of DSO business models in Europe by 2030, taking into account technological, macroeconomic and geographical parameters. It proposes an original theoretical and analytical vision, first introducing the notion of "natural potential technologies" to study the optimal development of different technologies by geographical context and by reference scenario. Based on these results, it then defines different possible evolutions of distribution activities. The cross-referencing of these futures with the different investment strategies that can be envisaged for DSOs allows to define the future business models of European DSOs according to the combinations of smart technologies deployed and the contrasting geographical contexts. In its last part, the thesis focuses on the foreseeable changes in the DSO/regulator relationship via a game theory formalization. Finally, based on Brian Arthur's theoretical studies, the thesis identifies the various lock-in effects that could hinder the emergence of smart technologies and possible solutions.

This thesis focuses on the impact of the EU ETS on investment decisions in the European power sector. After a description of the EU ETS and other major developments, we discuss the main ways that compliance actors deal with the EU ETS constraint: emissions reductions, carbon asset acquisition, and other types of responses. We present the results of an empirical review of investments by the European power producers most constrained by the EU ETS. Investment decisions were driven more by strategic and economic considerations than by the introduction of a CO2 price. We discuss the impacts of these investments on the carbon compliance of European power producers: tons of CO2 potentially fixed by the investments, changes in compliance perimeters, but also carbon leakage and use of project mechanisms. Finally, we explore the impact of allowance pricing scenarios on the investment portfolios of power generation capacity. We show that: the EU ETS has a small but central role in reallocating investment portfolios . any indication of the long-run carbon price trend is very useful . some elements of the EU ETS have only a small effect on investment . carbon price expectations influence investment portfolio decisions . while the EU ETS plays a central role, it is the combination of emission reduction and other policies that matters most.

The sustainable development of the energy sector in developing countries poses a constantly renewed challenge for the applied economy. Access to electricity and, more generally, to reliable, economically viable, socially acceptable and environmentally friendly energy services and resources, is necessary to improve the living conditions of populations and to develop a competitive economic fabric. The work undertaken during this thesis consists of describing and analyzing the Cameroonian energy system with respect to current energy policies. Is it possible to satisfy the energy demand resulting from population growth and the necessary economic development, under environmental constraints? According to the econometric study, it is GDP growth that "causes" electricity consumption, as the country's economy is largely supported by agriculture, oil and the informal sector. This thesis shows that although Cameroon does not have many environmental constraints, it will have to continue to develop hydropower, because of its potential and environmental virtues, in order to provide the energy needed by households and businesses. The country will also need to continue to develop its oil and gas resources, and diversify its energy supply to make the most of its renewable energy resources. To do this, the current regulatory and institutional framework needs to be redesigned to make it more attractive to investment. These are the conditions for sustainable energy development in Cameroon.

Global climate change is a major problem of the 21st century. A limitation of warming to +2⁰C above pre-industrial levels should mitigate environmental degradation. Given the state of climate science, this sustainable development goal requires a stabilization of greenhouse gas (GHG) concentrations at 450 ppmv CO2-equivalent. Over the next half century, the international community will have to reduce its GHG emissions drastically, by about 50% compared to 1990 levels. In this context, Europe has adopted an official GHG reduction target of 20% in 2020 compared to 1990, which can be increased to 30% in the event of a fair international agreement. In the long term, the EU aims at a minimum of 80% reduction in 2050, the minimum percentage required under the 450 ppmv CO2-eq. constraint. This thesis models the carbon effort in Europe to reach -80% GHG in 2050. On the projection, the OCTET (Optimal Carbon Trajectories for Emission Targets) model projects a set of temporally optimal CO2 trajectories. Effective reduction strategies are specified for the transition points (2020, 2030, 2040) based on international uncertainty. The thesis also calculates carbon price profiles in Europe for a factor 5 abatement constraint as well as abatement costs. Overall, the thesis explores the implications of a low-carbon European society and informs European abatement policy for 2050.

China consumes more than 60 percent of coal in its energy mix. This dependence has strong environmental consequences, including CO2 and SO2 emissions, for which China is the largest emitter. This already has huge local, regional and global implications. Not only does pollution reduce agricultural productivity (regional) and increase asthma or cancer (local), but now it can change the climate and the conditions in which people live. This thesis aims to describe the environmental impact of China's increasing energy use and, more importantly, to answer the question: what solutions could be implemented to achieve environmentally sustainable development? In this essay, we aim to show that the window of opportunity is not yet closed and that, with negative price elasticity of harmful emissions, a price-based solution could work in China. First, by removing subsidies, the government should allow prices to correct signals to consumers (thereby reducing the amount of fossil fuels consumed) and producers (who would move to better technologies or less polluting fuels). Second, by making producers pay for the externalities they create with a tax, for example, the government could also reduce pollution. Overall, the implementation of this solution should reduce energy intensity, consumption of polluting fuels, carbon and sulfur emissions, and improve public finances.

The main objective of this thesis entitled "Essays on CO2" is to study, from a financial point of view, the functioning of the European Union Emissions Trading Scheme. In accordance with the Kyoto Protocol, the European Union set up the first phase of the European Union Emission Trading Scheme (EU ETS) in 2005, which allowed for the launch of trading on organized spot and forward markets. The first chapter of this thesis presents the main information concerning the implementation of emissions trading around the world. The objective of the second chapter is to analyze the determinants of allowance prices during the first year of the EU ETS. The prices of the most significant energy variables in Europe as well as indexes of non-linear climate variables have a statistically significant influence on allowance prices. The third chapter consists of studying the impacts of the institutional regulation of the market on the price of CO2 allowances, both on the returns and on the variance. Here we find an influence on the returns of the CO2 allowance, but not on the volatility. This leads us to believe that there was an information leakage before the official announcement of the European Commission. Finally, the last chapter studies the portfolio diversification possibilities that emission allowances can offer to the different investors present in the market.

In this thesis, we propose the definition of a global monitoring procedure involving network operators, regulators and competition authorities in the definition of efficient market structures and rules for electricity exchange. We show that the effectiveness of this procedure depends on the possible antagonism in the exercise of decision-making powers delegated to the regulator and those held by the competition authorities. A comparative study of the PJM and NET A markets then allows us to define two possible models of delegation and coordination of supervisory powers. We show that they alternatively favor a "strong" informational coordination between regulator and network operator or a "strong" decisional coordination between regulator and competition authorities. In the last part, these conclusions are put in perspective with the problem of creating an integrated European market for electricity exchange. We show that the approval of regional market initiatives requires the delegation of decision-making powers to a supranational regulatory agency, "constrained" by "strong" decision-making coordination with the European Commission in the exercise of EU competition law.

The work published in 1838 by Antoine-Augustin Cournot (1801-1877), Recherches sur les principes mathématiques de la théorie des richesses (Research on the mathematical principles of the theory of wealth), is considered to be a precursor of modern economics, particularly through the influence it exerted on marginalist economists from the end of the 19th century. Nevertheless, the approach taken by Cournot in 1838 cannot be understood independently of the intellectual context of its appearance. The purpose of this work is to shed light on the conditions of the use of mathematics in the Recherches, by placing this approach within the framework of theoretical questions specific to classical political economy and by providing an epistemological perspective. This thesis shows that, far from constituting a break with the dominant economic theory, the approach of the Recherches reflects, on the contrary, Cournot's attachment to the classical concept of value, characterized by the coexistence of several registers of evaluation, hierarchical and articulated between them. This thesis also shows the originality of Cournot's epistemological posture and the way in which he conceived of the intervention of mathematics in knowledge.